Business Strategy and SWOT examination of nike

Business Technique and SWOT examination of nike

Executive Summary.

Nike is a Among the leading company on the planet which generally activated in design and style, development and global market with high quality of equipment, shoes and accessory goods. Nike is one the largest seller of athletic shoes or boots and apparel on earth. The Nike is acquired the best position in the market to get with the procedure of athletic market. The business is usually excavate into any niche market in relates with sports activities market along with technical breakthroughs, retailing, supervision of sports and sports activities promotions. Nike is currently going into the particular market of the Pakistan. Here is the best time for Nike to present its women’s footwear, clothing and tools for the women’s of Pakistan for the reason that women’s are getting flexibility in Pakistan. Pakistan is already one of the biggest supplier for the Nike’s sports. History of Nike’s.

In 1962, two persons from example of scholarship essay the University of Oregon designed a undersized organization with the brand of Blue Ribbon.In the 1972, the business transformed his name and became into the market with the brand of Nike. In today’s situation, Nike owns facilities in Oregon, Tennessee, Netherlands and the North Carolina. It also working in leased services for 15 Nike-towns, a lot more than 80 Nike Factory Shops, 2 NIKE goddess boutiques and more than 100 product sales and administrative office buildings. There are just about 23,000 people involved by the Nike, wide-reaching. The company’s first year sales did not cross $ 10,000 on the other hand, its present revenues exceed well over$10billion.

Nike research lab is generally pursuing modernization in neuro-scientific sports. The research work in the lab is certainly circulated into three categories incorporating biomechanics, physiology and sensory/perceptual features. The researches main purpose is to focuses on differentiating elements like geography, sexual category, age and skill level.

Products of Nike can largely become scattered into two categories as footwear and tools. The footwear has been sub characterized into various product lines including sports customs, running, basketball and soccer. Nike is doing their business in an exceedingly customer slanting industry. This means that the necessity for the Nike’s products seriously depends on the attractiveness of the several fitness actions. The business adjusts incessantly their product mix in direct to meet up requirements. It manages its organization cautiously, top rated in hostile marketing styles and pioneering items.

Nike Mission statement.

„our mission is to bring motivation and and innovation to every athlete on the planet”

„if u have body system, u are an athlete”

(My strategic program,2008)

Nike as Innovative Organization.

According to (S. Parkash Sethi,2003) Nike is probably the highly enterprunual and progressive company that is running on multiple ways it took all the relevancy and utilitarian in all purposes its aims to one type suits all Nike has the high tech and high quality footwear and athletic sports activities equipment for all seasons.

Business Plan.

Pakistan may be the most passionate country on the globe in conditions of sports. It is the time for Nike to expose his footwear and clothes for women’s because women’s of the Pakistan are now participating shoulder to shoulder with men in all fields of life. Most important challenges confronted women in Pakistan in the start of 1990s: rousingly

practical literacy, attainment usage of service possibilities at all levels in the

economic, marketing revolutionize in the sensitivity of women’s roles and status, and

getting your hands on a general public vote both outside and inside of the political process. Kiran khan and Robab Naz are thinking about part module for Pakistani women’s. Following the getting ranking in overseas ranking today Pakistani women’s cricket is also extremely popular in the Pakistan.

SWOT analysis.

According to (Bohim,2008) Examining a company internal and external environmental is vital along the way of strategic setting up the swot analysis which includes the analysis power , weakness, prospects and threats investigates both internal and external as well as negative and positive factors of a corporation based on swot analysis a marketing strategy can be deverlped using corporate strengths in addition to keeping away from corporate weaknesses to enable a company to benefits from future opportunities with regards of upcoming risk.

Strengths

Weaknesses

Brand Name

Dependent on footwear sale.

Innovation.

Don’t have Nike’s individual retailers.

Famous Spokespersons.

Doesn’t in a position to capture the local market like international market.

Gradually growth

Strong Research and production department.

Opportunities

Threats

Jumped into recycling.

Currency fluctuation

Sunglasses and jewellery

By the competitors alternative brands

Maintaing e-co friendly envirement

Companies financial status

Nikes Company Situation Research.

Critical success factors

Waight

Nike

Under-Armour

Addida-Rebok

Quality

0.50

10=5.0

10=5.0

10=5.0

Markiting

0.25

10=2.5

08=2.0

08=2.5

Price

0.25

09=2.5

08=2.0

09=2.5

1.00

09.75

09.00

09.25

(David C Kimball, etc ,2009)

Market Analysis.

Market Segmentation.

„Market Segmentation may be the procedure for identifying different group of users with in a market who could possibly be targeted with a separate products or marketing courses.”(Michael j croft n.d )

Market Size.

„Pakistan with population of over 140 million has a demand of 220 million pairs of shoes annually.”

(Daily times, 2003)

Pakistan have the population of 140 million and the Women’s for the reason that are 47.5% of the full total.

Location.

Nike’s targeted location is the Pakistani market particularly women’s markets so they need to design the product in line with the needs and of the Pakistani women’s.

Gender.

Nike’s targeted gender will be the women’s in the Pakistan that are the 47.5% of the total population this is the market for the Nike’s and the Pakistani women’s are not quite definitely use to of training so they need to be very focused.

Age Group.

Nike’s targeted buyers are from all the group fellows. The products must be varied out of every group the largely used customers will be the teenagers between 13 to 25.

Religion.

In Pakistan a lot of the Muslims and the different religions like Christians and Hindus are also have the customers in Pakistan. So the company must be care full the norms and values of the religion.

Buying Power.

The market of the Pakistan is not so strong therefore the company must set their prices at that level where majority of people are willing to accept that product.

Education.

The education level isn’t fully up to standard but now a day’s Pakistan sloly and steadily heading towards the bitterness’ and persons can now under to understand the value of health and safety.

Cultural Influence and Organization.

„Culture is the part of human actions that is socially instead of gentacally transmitted. It comprises the theory through which we perceive and interpret the universe, symbols we employ to connect thsese idieas, and organization which enable individuals to become socialised and meet their needs”(David Needle 1994 )

The customs of the Pakistan is very rich and the business needs to look at the culture of Pakistan where women’s are not mostly allowed to wear tide dress and so the company must understand the pros and norms of this culture and design the merchandise according to the needs of that culture.

PEST Analysis.

http://www.learnmarketing.net/pestmarketing.jpg

(Source,; website)

According to (Administration Bluffers 2000) Now a day’s environmental is normally changing daily and its reached generally there where it wasn’t before continuously changing

the environmental make mangers job is so tough more recently. That’s why the PEST analysis is useful and simple device for the supervisor where they are able to track the environmental changes impacts on the business it includes the social, Political , Economical ,and technological. It is problematic for others to resist assessment with (a) an inept individual and (b) vermin to get eliminated.

Political.

„Countries have both marketplace and non-market environment. The marketplace environment involves the conversation between households( or persons ) and businesses to allocate resources, clear of governmental ownership or control. The non-market government companies and government owned business ).(Johan D,Daniel , lee 1998)

According to the current political condition of the Pakistan is trying to stable the overall economy of the country and if Nike’s introduce new products into the market the market condition will be more better as the Nike’s has the brand name in the footwear market.

Economical.

„Economics factors are affect the purchasing power of potential customer and firms expense of capital”(John William, Curtis,2006)

Nike’s must consider the financial factor as a main role in Pakistan. During the calendar year of 2008 Pak rupee benefit is decreased and Pakistan is normally facing the Bank crisis as well so company needs to have a very strong capital to face these situation. The business needs to consider the next steps.

Current economic system in the Pakistan.

Exchange rate and balance.

Business cycle.

Economic rate of growth

Rate of unemployment

Rate of Inflation.

Social Factor.

Social factors includes the demography of the persons. How the persons behave to towards the products and What are the norms and benefit of particular countries. In Pakistan women’s aren’t allowed to venture out for exercise so business must give the awareness and provide the establishments to the women’s of Pakistan.

Technological Factor.

According to blab bulb is must be consider

New purchasing mechanism

New production technology

New distribution mechanism

New approach to working

Opportunities for services to sell

The Pakistan is producing country so the trend of online browsing isn’t so much favorite in Pakistan still people visit the market for shopping consequently and distribution method is also same like people would like to by through suppliers chain.

Competitors.

„No firm can exists in vacuum”(Lay son,1998)

It is really very important for the company to know who happen to be their potential competition and what the strategies they are employing to capture the market as the CEO Philip kotler says a quite that” organization is a battle without bullets”. Nike’s key competitors happen to be in the Pakistan marketplace are

Addidas

Puma

Reebok

And local Firms

http://www.psfk.com/wp-content/uploads/HLIC/1ac79b884a0c8da1796d12e024fce542.jpg

Although Nike is among the biggest company in the world in soccer and shoes or boots with a high brand name but its rival provider Addidas giving really incredibly tough time in china addidas take over china with 60% shares and Nikes is 2% behind the addidas but in Pakistan culture people are mostly brand oriented and Nike is already working in soccer market in Pakistan so Nike has competitive benefit that Nike is usually contributing in the economy of the Pakistan.

To introduce the brand new product into the market the company must analyse the the porter five forces as well to contend with rivals the company needs to understand and make a good technique for these forces.

Marketing Mix .

” The group of tools that management may use to influence sales”(Philip Kotler)

Every targeted market has to be a exceptional marketing mixture to convince the demands of the beleaguered consumer to achieve the companies goal the strategy must be followed by the each one of the each and every 4p and Because these four ps will be the basics of the approaches that to attain the firms goals. Nike also must follows this plan to enter into the Market of Pakistan.

Product.

Nike’s Product according of Pakistan market is the women’s footwear and outfits Nike’s needs to design the merchandise as the demand of the marketplace in Pakistan and must keep in mind the cultural barriers that are confronted by the women’s of Pakistan.

Price.

According to(Stafanie Hoffmen 2005) Value is a potential advertising mix because it has the direct effect on the buyer , economy and the company as well. The price is major indicator about the caliber of the product. Because of depressed economy and like additional developing countries persons of Pakistan buying electricity isn’t so strong 98% people you live average level lifestyle so Nike’s needs to set that price for the merchandise that are acceptable by a lot of the population .

Place or Distribution.

Place or distribution strategies are nervous about „making product obtainable when and where customer wish them”(Charlas W lamb,2009 )

In Pakistan the areas of capturing where in fact the more output the company get is the primary cities of Pakistan like Karachi, Lahore, Islamabad. These are the main markets for the Nike’s to be captured. And needs to be the access able for the customers.

Promotion.

„Promotion or Advertising communication is the element of marketing mix used to inform and persuade the targeted market to buy or make use of and organization items promotion is the aspect in the marketing mix that communicates the main element message to targeted visitors”(Richard barker, Gorge,nd )

In Pakistan Nike’s gets the best opportunity for promotion to utilize the Pakistani women’s hero’s like Robab and Kiran khan and the Pakistani women’s cricket staff players to promote and products and the brand in the country. The best approach to advertising and advertising in Pakistan is electronic digital media.

Financial data.

NIKE, Inc.

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED MAY 31, 2010

(In millions, except per show data)

QUARTER ENDED

YEAR TO DATE ENDED

INCOME STATEMENT

31/05/2010

31/05/2009

% Chg

31/05/2010

31/05/2009

% Chg

Revenues

$5,076.9

$4,713.0

8%

$19,014.0

$19,176.1

-1%

Cost of sales

2,670.7

2,669.2

0%

10,213.6

10,571.7

-3%

Gross margin

2,406.2

2,043.8

18%

8,800.4

8,604.4

2%

47.4%

43.4%

46.3%

44.9%

Selling and administrative expense

1,737.9

1,394.3

25%

6,326.4

6,149.6

3%

34.2%

29.6%

33.3%

32.1%

Restructuring Charges

0.0

195.0

-100%

0.0

195.0

-100%

Goodwill Impairment

0.0

0.0

0%

0.0

199.3

-100%

Intangible and additional asset impairment

0.0

0.0

0%

0.0

202.0

-100%

Other (income), net

(17.0)

(34.4)

-51%

(49.2)

(88.5)

-44%

Interest expense (income), net

2.5

2.6

-4%

6.3

(9.5)

−

Income before income taxes

682.8

486.3

40%

2,516.9

1,956.5

29%

Income taxes

160.9

144.9

11%

610.2

469.8

30%

23.6%

29.8%

24.2%

24.0%

Net income

$521.9

$341.4

53%

$1,906.7

$1,486.7

28%

Diluted EPS

$1.06

$0.70

51%

$3.86

$3.03

27%

Basic EPS

$1.08

$0.70

54%

$3.93

$3.07

28%

Weighted Average Common Shares Outstanding:

Diluted

493.9

489.4

493.9

490.7

Basic

484.4

484.8

485.5

484.9

Dividends declared

$0.27

$0.25

$1.06

$0.98

(Source,;website)

Balance Sheet of Nike.

NIKE, Inc.

BALANCE SHEET

31/05/2010

31/05/2009

(In millions)

ASSETS

Current assets:

Cash and equivalents

$3,079.1

$2,291.1

Short-term investments

2,066.8

1,164.0

Accounts receivable, net

2,649.8

2,883.9

Inventories

2,040.8

2,357.0

Deferred income taxes

248.8

272.4

Prepaid expenses and additional current assets

873.9

765.6

Total current assets

10,959.2

9,734.0

Property, plant and equipment

4,389.8

4,255.7

Less accumulated depreciation

2,457.9

2,298.0

Property, plant and products, net

1,931.9

1,957.7

Identifiable intangible assets, net

467.0

467.4

Goodwill

187.6

193.5

Deferred income taxes and other assets

873.6

897.0

Total assets

$14,419.3

$13,249.6

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:

Current portion of long-term debt

$7.4

$32.0

Notes payable

138.6

342.9

Accounts payable

1,254.5

1,031.9

Accrued liabilities

1,904.4

1,783.9

Income taxes payable

59.3

86.3

Total current liabilities

3,364.2

3,277.0

Long-term debt

445.8

437.2

Deferred income taxes and other liabilities

855.3

842.0

Redeemable preferred stock

0.3

0.3

Shareholders’ equity

9,753.7

8,693.1

Total liabilities and shareholders’ equity

$14,419.3

$13,249.6

(source,; website)

Recommendations.

In current circumstances Pakistan market is niche for women sneakers and apparel. In line with the research. It is strongly recommended that Nike’s needs a very strong and tactical strategy for Pakistan because in Pakistan women’s are getting rights but still that is clearly a conservative country. Pakistan can be an Islamic point out where women’s are not allowed to wear tides and bikinis what happens in chemosynthesis and in addition in Pakistan just in big towns there are separate exercise clubs for the women’s so Nike’s also needs to develop health and wellbeing clubs and take a component in spreading the awareness of medical issues. Pakistan market is good market but more than 80% population is under the poverty level so price tag needs to consider virtually all in this.